Canadian, Mexican, and American flags stand on display during NAFTA negotiations in Mexico City in November. A new round of talks will begin next week in Montreal.

Canadian, Mexican, and American flags stand on display during NAFTA negotiations in Mexico City in November. A new round of talks will begin next week in Montreal.

Photo: Alejandro Cegarra

Image 2 of 5

CEDAR RAPIDS, IA - JUNE 21: President Donald Trump speaks at a rally on June 21, 2017 in Cedar Rapids, Iowa. Trump spoke about renegotiating NAFTA and building a border wall that would produce solar power during the rally. (Photo by Scott Olson/Getty Images)

CEDAR RAPIDS, IA - JUNE 21: President Donald Trump speaks at a rally on June 21, 2017 in Cedar Rapids, Iowa. Trump spoke about renegotiating NAFTA and building a border wall that would produce solar power

Mexican Secretary of Economy Ildefonso Guajardo Villarreal, left, and U.S. Trade Representative Robert Lighthizer wait for the start of a news conference after the fourth round of NAFTA negotiations in Washington. less

Mexican Secretary of Economy Ildefonso Guajardo Villarreal, left, and U.S. Trade Representative Robert Lighthizer wait for the start of a news conference after the fourth round of NAFTA negotiations in ... more

Photo: ANDREW CABALLERO-REYNOLDS, Contributor

Image 4 of 5

United States Senator John Cornyn (right, foreground) arrives Monday November 20, 2017 at the San Antonio Marriott Plaza Center Hotel for the NAFTA field hearing on the 24th anniversary of the Senate's approval of the pact. Panels of witnesses spoke at the meeting to voice their views on the modernization of the North American Free Trade Agreement (NAFTA) while negotiators for the revised "NAFTA 2.0" are in Mexico City for talks. less

United States Senator John Cornyn (right, foreground) arrives Monday November 20, 2017 at the San Antonio Marriott Plaza Center Hotel for the NAFTA field hearing on the 24th anniversary of the Senate's approval ... more

Photo: John Davenport, STAFF

Image 5 of 5

Energy industry confronts the NAFTA doldrums

1 / 5

Back to Gallery

WASHINGTON - President Donald Trump sent shock waves through the Texas business world when he opened up the North American Free Trade Agreement for renegotiation four months ago.

Would he tear up the deal? Would he imperil what for many is a lucrative cross-border trade between Texas and Mexico?

But so far developments have been slow in coming, with government officials announcing that negotiations would extend through at least the end of March.

"Most people think this is going to take a while," said Chet Thompson, president of the American Fuel & Petrochemical Manufacturers, which represents a number of Texas refineries. "You have the Mexican election and the U.S. midterms to contend with. This could easily go through 2018."

Texans in Washington are left trying to figure out what the White House is trying to accomplish.

What has many corporate leaders worried is U.S. Trade Representative Robert Lighthizer's focus on a provision within NAFTA that allows companies that feel they have not been treated fairly by a host government to take their claims before an independent tribunal.

The U.S. Chamber of Commerce maintains the provision is critical to protecting U.S. investments abroad. And considering the billions U.S. oil companies are readying to invest in Mexico now that its energy sector is open to foreign investors, oil executives are among NAFTA's biggest cheerleaders.

Last week, during a hearing before the House Energy and Commerce Committee, Texas congressmen expressed concern that if the Trump administration demanded a roll back in investment protection, it could do damage to increasingly intertwined energy markets in the United States, Mexico and Canada.

"On the one hand, the White House says we believe in energy dominance for our country and North America. On the other hand, the U.S. trade representative is undercutting that," Rep. Bill Flores, R-Waco, said.

The risk for Texas were NAFTA to be done away with - as President Donald Trump has threatened - is the loss of business for the state's dominant oil and gas industry. Mexico is the biggest export market for U.S. natural gas producers, at the same time refineries along the Gulf Coast rely on crude from Mexico and Canada to operate.

But Trump is riding increasing skepticism within the Republican and Democratic parties on free-trade deals that many see as giveaways to multinational corporations at the expense of the domestic workforce.

But just how far he is willing to go remains an open question among lobbyists in Washington.

"We hope some of this is just negotiating tactics," Thompson said.

In the meantime, corporate lobbyists are eagerly making their case for the White House to preserve NAFTA more or less as is - with some adjustments here and there to account for economic and technological advances made since the original agreement was signed into law by former president Bill Clinton in 1993.

At the center of those efforts are the growing oil and gas production out of North America, with the United States, Canada and Mexico ranking first, fifth and 11th on the global list of largest oil producers.

And more centrist congressmen from both parties are taking note.

"We're on our way to replacing OPEC with a de facto NAPEC," said Rep. Pete Olson, R-Sugar Land. "The Eagle Ford Shale doesn't stop at the Rio Grande, waiting for a visa to cross."